5 popular internet claims in regards to America's energy crises, examined

There are 5 popular claims in regards to America's energy crises circulating the internet that are to say the least, deceptive. I've decided to address each of them and I'd like input from ATSers as well.

1. The federal government charges 50 cents to the gallon! They could bring the cost down by simply eliminating the fuel tax!

Wrong. While there is a Federal fuel tax in place, it's 18.4 cents to the gallon. The rest usually comes from a State fuel tax (excluding Alaska). For example, the State of Texas charges 20 cents on top of the Federal fuel tax!

What difference would eliminating the Federal fuel tax make? Well let's take an example; in January of this year a gallon of crude was $3.39 at average. By March 2012 a gallon of crude amounted to $3.86, there was a change of 47 cents in the cost of crude within a matter of 3 months. So what amount of difference would eliminating the Federal fuel tax make in the cost of crude? Not much, especially considering that the price of crude is influenced by international demand:
www.eia.gov...

2. There are trillions upon trillions of barrels of crude reserves hidden below the rockies!

No, those aren't crude reserves, those are shale oil reserves, and the USG estimates around 1.5 trillion barrels. Shale oil (otherwise known as Kerogen) is a non-renewable alternative energy source to crude oil, it is a different type of oil all together. Shale oil can be converted and used in the same manner as crude oil, but it takes a considerable amount more in energy to convert, as well as in extraction.

Oil shale is an inorganic rock that contains a solid organic compound known as kerogen. Oil shale is a misnomer because kerogen isn't crude oil, and the rock holding the kerogen often isn't even shale.

Liquid crude oil consists of organic material--plant and animal remains--that's been exposed to heat and pressure over millions of years. The slow transformation of organic material into oil progresses through a number of stages. Kerogen occurs relatively early in this process. To understand where kerogen fits into the developmental timeline, consider that bitumen--the hydrocarbon found in Canada's oil sands--represents a later stage in the process. In a sense, bitumen is a higher-quality and more useful hydrocarbon than kerogen.

To generate liquid oil synthetically from oil shale, the kerogen-rich rock is heated to as high as 950 degrees Fahrenheit (500 degrees Celsius) in the absence of oxygen, a process known as retorting.

Read more: community.nasdaq.com...

Ironically it was Jimmy Carter, the 39th president of the United States, who first lead government support towards tapping into the vast shale oil reserves hidden beneath the rockies, however it didn't work out. Exxon and other oil corporations soon pulled out years after when their investment in shale oil as a viable alternative to crude didn't pan out all too well:

Carter insisted that U.S. automakers build more fuel-efficient cars, with a goal of 27.5 miles per gallon over the following decade - a requirement passed under Gerald Ford but put into force by Carter.

He offered incentives for getting oil from shale, creating a boom initially in the Rockies - and a bust when it failed to be cost-effective.

www.energybulletin.net...

3. Increasing or mainting subsidies for oil corporations will be a key factor toward American energy independence.

Not really. During the last 10 years that oil subsidies were steadily on the rise, American oil producers more than quadrupled the number of domestic crude oil exported abroad. In 2011 when oil corporations made record profits, and gained billions of dollars worth of oil subsidies, they were also exporting more than 4 times as many barrels of domestically sourced crude oil than they did in 2002, that number has been on a stead increase.
205.254.135.7...

4. There are billions of barrels of crude hidden in Northern Alaska, most of it within the Arctic Wildlife refuge.

Yes this is true. As an estimated range, the USG calculates that there are some 6-16 billion barrels of crude oil reserves hidden below the Alaskan National Wildlife Refuge. Putting aside the years it will take to extract the crude resources hidden up there and the possibility of a negative environmental impact, and if we were to calculate this to the higher end of the range, 16 billion barrels, we're not looking at a long term solution to America's energy concerns. Assuming that all those barrels of crude oil are all used just for American energy needs, we're looking at around 3 years tops. To supply just to 20% of America's energy demands daily, we will exhaust the estimated crude reserves hidden in ANWAR by just under 13 years.

Remember, these calculations assume the estimated reserves are to the higher end of what the USG report, and we're also assuming here that all those reserves will be used to suppliment America's needs only. As a side note, America consumes more than 18 million barrels of crude a day, 6.57 billion barrels a year. This number has been on a steady increase for the last century.

5. Wind turbines are responsible for an estimated 40,000 animal deaths yearly in the United States alone!

Yes. There is also an estimated 60-80 million animal casualties as the result of Automobiles a year, around 130,000 animal casualties as the result of windows, yes windows, and another 40 million animal casualties as the result of lighting towers.

science.howstuffworks.com...

Taxes can impact it a great deal, just crossing the org ca boarder drops the prices something like 20 cents alone in state tax, take the fed away as well as state and I. Some places that's 40 cents.

In org they even pump the gass for you w out the state tax.

Originally posted by benrl
Taxes can impact it a great deal, just crossing the org ca boarder drops the prices something like 20 cents alone in state tax, take the fed away as well as state and I. Some places that's 40 cents.

In org they even pump the gass for you w out the state tax.

I believe that eliminating the Federal fuel tax will ease the pain at the pump, but it won't solve the problem with the cost at the pump. I don't see this as a solution, especially considering that taking away revenue permanently from the government to temporarly ease cost, I just don't see where this will do much. I support the idea of a Federal fuel tax holiday, but this certainly is not a long term solution to the energy crises, not by a long shot. By the way, 60% of the revenues gathered by the Federal fuel tax are passed on to highway and bridge construction, maintanence, projects:
www.pbs.org...

As for State fuel taxes, if you want to eliminate them you'll have to go State by State, and fat chance doing that. State governments rely on revenue from fuel taxes just as much as the Federal government. Texas tried to pass a State fuel tax holiday in 2007 as I recall and this failed to get through the Republican majority senate at the time. You will need to jump through alot of hoops to get rid of both the State and fuel taxes, it's unrealistic.

I have to ask!

The USA increased it's exports in crude oil. Any chance they may have obtained these exports from somewhere else. I am thinking Iraq for instance. Wouldn't want to admit where it came from. It just seems very strange that the USA invades a country rich in oil reserves and suddenly has an over abundance of oil.

Just asking the question!

P

Originally posted by pheonix358
I have to ask!

The USA increased it's exports in crude oil. Any chance they may have obtained these exports from somewhere else. I am thinking Iraq for instance. Wouldn't want to admit where it came from. It just seems very strange that the USA invades a country rich in oil reserves and suddenly has an over abundance of oil.

Just asking the question!

P

I obtained this data from the EIA over here:
205.254.135.7...

This is crude oil from the United States and United States territories. As for the your question about why the U.S would be so desperate for more crude oil reserves if they continue to increase exporting their own sources of crude? Well it comes down to private businesses. Contrary to what many have deluded themselves to believing, American oil corporations are not necessarily 'patriotic', allowing them to drill just anywhere does not mean that crude oil is going to the tanks of American cars. Oil corporations are in the business of making profit and they will sell to the biggest bidder, irregardless of what energy crises America will be suffering.

This is what I question about the 'drill baby drill crowd', putting aside what's left of our crude reserves in the United States, I really have to question what makes people believe that if we allow more permits for oil corporations, this means that crude from American soil is only going to be sold domestically? Where does this idea come from?? We're so quick to forget that oil corporations are in the business of making profit and that's it. There are plenty of foreign buyers willing to outbid American demands.

They should copy what China is doing, require x amount of our resources to be used domestically. If China can get away with doing it with rare earth resources we should do the same to boost our economy. We know that will never happen here, they always allow corporations to do whatever they want even if its causes our economy to tank.

Some say the only reason crude is so high is to attempt destroying China economy.

Originally posted by Echo007
They should copy what China is doing, require x amount of our resources to be used domestically.

I agree, but if did this, many people on the political right would see this as a form of regulation or statism and object, because we would be telling private businesses as to whom they could sell to. To me this is a different standard, considering that energy is fundamental to national security, and considering that it is American lands owned by American tax payers that are being exploited, I don't see much of a reason against setting conditions as to whom that crude is going to.

From what I have heard almost all if not all of the oil coming down the pipeline from Alaska is sold to Japan and not used here in the US. I have also heard they we sell it to them for LESS than what we have to pay to replace it from OPEC. So we get no benefit from the Alaska pipeline and in fact we lost money on it. That is what I have heard. I hope that is wrong but I have a feeling it is dead on.

2. There are trillions upon trillions of barrels of crude reserves hidden below the rockies!

No, those aren't crude reserves, those are shale oil reserves, and the USG estimates around 1.5 trillion barrels. Shale oil (otherwise known as Kerogen) is a non-renewable alternative energy source to crude oil, it is a different type of oil all together. Shale oil can be converted and used in the same manner as crude oil, but it takes a considerable amount more in energy to convert, as well as in extraction.

Well that would help make sense of this absurd article which attempts to claim the U.S. has as much potential reserves as the entire proven reserves of the world.

President Obama has said the U.S. possesses just 3 percent of the world's oil reserves, or about 22.3 billion barrels, writes Investor's Business Daily's John Merline. However, this figure represents just proven reserves. But one analyst believes he could be off by almost a trillion. According to the Institute for Energy Research's calculations, the U.S. actually sits on 1.442 trillion barrels of recoverable deposits.

That's over 60 times the amount we usually hear about. Merline writes that this larger number would be enough to meet all U.S. oil needs for about the next 200 years. Most of that — an estimated 1.4 trillion barrels — is locked into shale deposits in the Green River Formation in Wyoming.

The US Is Sitting On A 200-Year Supply Of Oil

reply to post by ChaoticOrder


Yes, the minute people say oil reserves, and add that to 'years' worth, they automatically assume it's the same crude that is more than often used and converted to the common gasoline we use. When I first heard about the claims that the Rockies were sitting on billions upon trillions of reserves in oil barrels, I thought something didn't sound right so I did research.

Take into mind that you can convert shale oils to be used in a similar matter as crude for fuel, it has been done before and is being done but at a very small scane. It takes a significant amount of energy and resources to convert shale oil toward the same usable liquid as crude is, it just isn't profitable for the corporations like Exxon and Chevron and it consumes too much resources and effort. Shell current has testing facilities in the rockies for shale oil, they have been there since the 80's and no luck or break through since then. What's more, ironically Jimmy Carter was the one who pushed this whole idea of shale oils as a viable alternative back in the 70's and he was heckled by many conservatives, now this idea is being pimped by Republicans. Gingrich for example stated that we were sitting oil reserves in the United States three times that of Saudi Arabia, he really needs to read the fine print.

Interesting thread.
I'll jump in as well with a link of my own taken from a thread I posted last year. Although, It's really a story about the whole of the Americas not just the US.

The Americas, Not the Middle East, Will Be the World Capital of Energy

For half a century, the global energy supply's center of gravity has been the Middle East. This fact has had self-evidently enormous implications for the world we live in -- and it's about to change.

By the 2020s, the capital of energy will likely have shifted back to the Western Hemisphere, where it was prior to the ascendancy of Middle Eastern megasuppliers such as Saudi Arabia and Kuwait in the 1960s. The reasons for this shift are partly technological and partly political. Geologists have long known that the Americas are home to plentiful hydrocarbons trapped in hard-to-reach offshore

More from the article...

[atsimg]http://files.abovetopsecret.com/images/member/11b811ae98d0.jpg[/atsimg]

But since the early 2000s, the energy industry has largely solved that problem. With the help of horizontal drilling and other innovations, shale gas production in the United States has skyrocketed from virtually nothing to 15 to 20 percent of the U.S. natural gas supply in less than a decade. By 2040, it could account for more than half of it. This tremendous change in volume has turned the conversation in the U.S. natural gas industry on its head; where Americans once fretted about meeting the country's natural gas needs, they now worry about finding potential buyers for the country's surplus.

Meanwhile, onshore oil production in the United States, condemned to predictions of inexorable decline by analysts for two decades, is about to stage an unexpected comeback. Oil production from shale rock, a technically complex process of squeezing hydrocarbons from sedimentary deposits, is just beginning. But analysts are predicting production of as much as 1.5 million barrels a day in the next few years from resources beneath the Great Plains and Texas alone -- the equivalent of 8 percent of current U.S. oil consumption. The development raises the question of what else the U.S. energy industry might accomplish if prices remain high and technology continues to advance. Rising recovery rates from old wells, for example, could also stem previous declines. On top of all this, analysts expect an additional 1 to 2 million barrels a day from the Gulf of Mexico now that drilling is resuming. Peak oil? Not anytime soon.

reply to post by SLAYER69


Very interesting Slayer, I'll certainly have a further read into this.